Pennsylvania fights to block Aetna-Humana merger

Jan. 25--Pennsylvania will continue to work to block the proposed Aetna-Humana health insurance merger because the tie-up would result in higher costs for consumers and less competition, state Attorney General Josh Shapiro said Tuesday.

An Aetna Inc. spokesman said Monday the Hartford, Conn.-based company was "giving serious consideration to an appeal" of U.S. District Judge John Bates' decision to reject Aetna's bid to buy Humana Inc. for about $34 billion. The insurers have 60 days to decide whether to appeal the ruling, Mr. Shapiro said. Humana is based in Louisville, Ky.

"Everyone benefits from competition," Mr. Shapiro said. "Had the merger gone through, not only do you risk higher costs, you also have the hassle that goes along with a merger, new paperwork and all the rest."

The deal would have affected more than 20,000 seniors with either Aetna or Humana coverage in Allegheny County, and more than 9,000 people in Westmoreland County, according to the Centers for Medicare and Medicaid Services.

Fewer people -- ranging between 1,100 in Armstrong County and 4,300 in Washington County -- would've been affected in Beaver, Butler and other counties surrounding Allegheny County, the agency said.

In addition to those two insurers, Medicare Advantage plans are offered in this region by UPMC, Highmark and others.

The lawsuit challenging the merger was brought on behalf of the Justice Department, which argued the sale would hurt competition in the market for Medicare Advantage insurance coverage. Medicare Advantage plans are an option to standard fee-for-service Medicare.

Mr. Shapiro said Pennsylvania led the legal challenge that was mounted by seven other states and the District of Columbia.

Testimony during a 13-day trial in December indicated the deal would cost consumers a half billion dollars nationwide, which was "something we just couldn't stand for," Mr. Shapiro said.

Kris B. Mamula:[email protected], or 412-263-1699

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